On Small Business Growth
Self-reliance is something that I’ve always valued and equate with personal strength. It’s a magical mixture of initiative, imagination, and tenacity. It’s one of the reasons that self-funding a business is so attractive. However, lately I’ve began to question its utility for entrepreneurs.
The most common approach to starting a new business or developing a new product is to start with an idea. This approach is inherently wasteful and has built-in obstacles. It’s a symptom of a solution oriented focus.
This is the story of SiteRescue. It is the second productized service that I launched. My goal was to achieve $7,000 – 10,000 a month in sales within six months of launching.
As a freelancer, your time is in short supply. There isn’t much that is more aggravating than wasting hours talking to someone about their project, scoping it, and writing a proposal only to get pushback on the price or have the lead disappear.
Sometimes, you discover too late that the lead doesn’t have a realistic budget for what they need done. Other times, the entire exercise seems like a free planning session where they basically get expert advice at no charge.
It wouldn’t be so annoying if there wasn’t a cost to talk to these people. Even if you have an excellent system for responding to inquiries for work you can still easily throw away a half a day you could’ve spent doing something useful.
Ugh! Tire kickers.
Is this just the cost of doing business? Knowing that you’re going to have to put out lots of proposals and talk with lots of people that aren’t qualified to work with you? Continue reading
Have you ever been in a position where you were “rich on paper,” but had a bank account that was starving for cash? It’s odd how you can have the pressure of debts and bills to be paid while still having several invoices you haven’t sent simply because you’re too busy to collect what is owed you. It doesn’t make sense, but when you’re hard at work it’s easy to let these tasks slide.
I know there have been many times where I’ve had a stack of checks sitting in my inbox and I just can’t seem to find the time to make it to the bank. Having even the small hurdle of opening Excel to record what has been invoiced and what’s been paid can help delay this task much longer than is helpful and create urgent situations which shouldn’t exist.
It’s a bit ironic considering how magical those first few invoices you sent out as a new freelancer were.
Everyone has a bad client sooner or later. It’s a part of building experience as a freelancer. However, it’s easy to get into a pattern where every client can seem like bad client early on in your career. I remember my first couple of years in business. I had clients who:
Like many freelancers, when I first started out, I would work with anyone who would hire me. After a few years, I developed enough of a client roster that I wasn’t continuously struggling to find new projects. However, even with a roster of clients, you still have peaks and valleys. When things were good, it was very easy to turn away work, but when things slowed down prospects that I would normally turn away began to magically look more attractive. I took on a few clients that I never should have worked with and regretted it on every occasion. It’s easy to think that any work is better than none. After all, it doesn’t matter if your rate is $400 an hour if you have 0 billable hours a month. However, the truth is that it’s better to be broke then to take on bad clients or projects.
Bad clients are cancerous to your business. They will drain your time, energy, and mental well-being. They will need to be managed while you work with them and eventually fired once you’re through your dry spell. This is an enormous cost on top of the discount rates they will seek. When you work with a bad client, it’s like taking a loan out against your future self. Yes, you will likely get paid now, but the interest on it is costly and it could be a burden you carry around for years. Continue reading
Freedom is the most cited reason that employees take the leap and become freelancers. I know that was true for me. One of my happier memories is of my last day as an employee when I stepped out of the building, got in the car, and drove away for the final time. This sense of liberation quickly gave way to the uncertainty of how I was going to make freelancing work. How was I going to get clients? After a few years, I stopped worrying about getting clients and begin to worry about keeping up. This is a typical transition for freelancers as you establish yourself.
Success leads to more and more work until it is queued up at a faster rate than you can do it. You begin to turn away most leads because you are too busy to take on their work any time soon. Often, you have several clients with ongoing projects that depend upon you to move their business forward. You end up constantly chasing deadlines, grinding out project after project. You’re moving, but you’re not really going anywhere. You’re on a treadmill.
It’s ironic: the reason you get into freelancing is for the freedom and success as a freelancer leads you away from freedom. Continue reading
One day a friend asked me how work was going and I replied, “death by email.” It was accurate in that I was spending around half of my day writing emails to clients about their projects and hating it. Eventually, we closed out those projects and things slowed again, but before I knew it, I found myself giving the “death by email” update to someone else. Unfortunately, this phrase begin to become more and more frequent to the point where some days I would stare out the window and mutter it like a lunatic. It was my little psychotic mantra.
Some people like writing emails. Idiots for example. (Ha!) However, I had better things to be doing and I was wasting my time in my inbox. On the other hand, those emails were essential. Communication had to occur in order for the projects to move forward. There was no getting around the need to email back and forth in order to get and keep things progressing.
When I set aside the time to think about it, I realized that it wasn’t the emails that were the problem. The problem was that we had become more successful in landing projects. Additionally, because web development is often an ongoing need, we were continuing to get new projects from our previous clients. All this incoming work required more and more project management and email just happened to be the medium through which I was doing it. However, there wasn’t more and more of me. While I was good at managing projects by necessity and experience, it wasn’t something I enjoyed, and it prevented me from actually moving things forward. Continue reading
A few years ago, my agency took on a client from a software startup in Toronto. The founder was a guy I will call James. I was doing all the communication with James and when we first discussed supporting his startup, I saw a few red flags in our conversation that revolved around pricing. However, when I presented him with our rates he still wanted to hire us.
I hate doing calls. I find them to be emotionally and mentally draining. Because of this, I require calls to be scheduled in advance. This helps me to divert people to email for quick questions and prepare myself emotionally for when it is important to get on the phone. Over the course of the two months we worked with James’ company, he regularly called me out of the blue to waste my time discussing something that I had already explained in an email very clearly. I knew it was clear, because he would reiterate what I had told him, sometimes two or three times, but then would go off on tangents. On top of this, he would regularly use the time to complain about our rates. Every time the phone rang my heart would jump with a surge of anger. I wasted a tremendous amount of time and mental energy trying to manage the relationship.
After two weeks, I knew that we needed to get rid of him. I formed a simple plan: I was going to charge him for every time he called and interrupted my workday. I could do this, because when we first discussed our working together I explained that we billed for everything. Our billing policy is simple: we bill for every task your project requires that prevents us from working on another client’s project. Continue reading